PRIOR PRINTER'S NO. 2619 PRINTER'S NO. 2948
No. 1996 Session of 2003
INTRODUCED BY ADOLPH, BAKER, BARRAR, CAPPELLI, BARD, CIVERA,
CRAHALLA, DAILEY, DENLINGER, GEORGE, GRUCELA, HARPER,
HENNESSEY, HERSHEY, HORSEY, JOSEPHS, KELLER, KENNEY,
LAUGHLIN, LEACH, LEH, MICOZZIE, R. MILLER, PAYNE, PETRI,
READSHAW, RUBLEY, SAYLOR, SCAVELLO, SHANER, SOLOBAY,
E. Z. TAYLOR, TIGUE, WASHINGTON, WATSON, WEBER, YOUNGBLOOD,
GEIST AND GINGRICH, SEPTEMBER 18, 2003
AS REPORTED FROM COMMITTEE ON ENVIRONMENTAL RESOURCES AND
ENERGY, HOUSE OF REPRESENTATIVES, AS AMENDED,
NOVEMBER 18, 2003
AN ACT
1 Amending Title 62 (Procurement) of the Pennsylvania Consolidated
2 Statutes, further providing for guaranteed energy savings and
3 contracts.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Sections 3752, 3753 and 3754 of Title 62 of the
7 Pennsylvania Consolidated Statutes are amended to read:
8 § 3752. Definitions.
9 The following words and phrases when used in this subchapter
10 shall have the meanings given to them in this section unless the
11 context clearly indicates otherwise:
12 "Allowable capital costs." Capital EQUIPMENT AND PROJECT <--
13 costs that:
14 (1) the governmental unit reasonably believes will be
15 incurred during the term of the guaranteed energy savings
1 contract; and
2 (2) are documented by industry engineering standards.
3 "Energy conservation measure." A [training] program or
4 facility alteration designed to reduce energy consumption or
5 operating costs. The term may include, without limitation:
6 (1) Insulation of the building structure or systems
7 within the building.
8 (2) Storm windows or doors, caulking or weather
9 stripping, multiglazed windows or doors, heat-absorbing or
10 heat-reflective glazed and coated window or door systems,
11 additional glazing, reductions in glass area or other window
12 and door system modifications that reduce energy consumption.
13 (3) Automated or computerized energy control systems.
14 (4) Heating, ventilating or air conditioning system
15 modifications or replacements.
16 (5) Replacement or modification of lighting fixtures to
17 increase the energy efficiency of the lighting system without
18 increasing the overall illumination of a facility, unless an
19 increase in illumination is necessary to conform to
20 applicable State or local building codes for the lighting
21 system after the proposed modifications are made.
22 (6) Energy recovery systems.
23 (7) Systems that produce steam or forms of energy such
24 as heat as well as electricity for use within a building or
25 complex of buildings.
26 (8) Energy conservation measures that provide operating
27 cost reductions based on life cycle cost analysis.
28 (9) A training program or facility alteration that
29 reduces energy consumption or reduces operating costs,
30 including allowable capital costs, based on future reductions <--
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1 in labor costs or costs for contracted services.
2 (10) A facility alteration which includes capital <--
3 expenditures that are required to properly implement other
4 energy conservation measures.
5 (11) A program to reduce energy costs through rate
6 adjustments, load shifting to reduce peak demand, and/or use
7 of alternative energy suppliers, such as, but not limited to:
8 (i) changes to more favorable rate schedules;
9 (ii) negotiation of lower rates, same supplier or
10 new suppliers, where applicable; and
11 (iii) auditing of energy service billing and meters.
12 (12) The installation of energy information and control
13 systems that monitor consumption, redirect systems to optimal
14 energy sources, and manage energy-using equipment.
15 (13) Indoor air quality improvements.
16 (14) Daylighting systems.
17 (15) Renewable and/or on-site distributed power
18 generation systems.
19 "Guaranteed energy savings contract." A contract for the
20 evaluation and recommendation of energy conservation measures
21 and for implementation of one or more such measures.
22 "Governmental unit." Any officer, employee, authority,
23 board, bureau, commission, department, agency or institution of
24 a government agency, including, but not limited to, any
25 Commonwealth agency, State-aided institution or any county,
26 city, district, municipal corporation, municipality, municipal
27 authority, political subdivision, school district, educational
28 institution, borough, incorporated town, township, poor
29 district, county institution district, other incorporated
30 district or other public instrumentality which has the authority
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1 to contract for the construction, reconstruction, alteration or
2 repair of any public building or other public work or public
3 improvement, including, but not limited to, highway work.
4 "Industry engineering standards." Industry engineering
5 standards may include the following:
6 (1) Life cycle costing.
7 (2) The R.S. Means estimated method developed by the
8 R.S. Means Company.
9 (3) Historical data.
10 (4) Manufacturer's data.
11 (5) American Standard Heating Refrigeration Air
12 Conditioning Engineers (ASHRAE) standards.
13 "Qualified provider." A person or business which is
14 responsible and capable of evaluating, recommending, designing,
15 implementing and installing energy conservation measures as
16 determined by the governmental unit.
17 § 3753. Contracting procedures.
18 (a) General rule.--Notwithstanding any other contrary or
19 inconsistent provision of law, a governmental unit may enter
20 into a guaranteed energy savings contract with a qualified
21 provider in accordance with the provisions of this subchapter or
22 in accordance with another statutorily authorized procurement
23 process.
24 (b) Guaranteed energy savings contract.--If in accordance
25 with applicable law the award of a contract by a governmental
26 unit requires action at a public meeting, a governmental unit
27 may award a guaranteed energy savings contract at a public
28 meeting if it has provided public notice in the manner
29 prescribed [by the act of July 3, 1986 (P.L.388, No.84), known
30 as the Sunshine Act,] under 65 Pa.C.S. Ch. 7 (relating to open
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1 meetings) the notice including the names of the parties to the
2 contract and the purpose of the contract. For governmental units
3 that are not required to take actions on contracts at public
4 meetings, the governmental unit may award a guaranteed energy
5 savings contract in accordance with the procedures adopted by
6 the governmental unit and the requirements of all applicable
7 laws.
8 (c) Competitive sealed proposals.--For the purpose of
9 entering into a guaranteed energy savings contract, all
10 governmental units are authorized to utilize the competitive
11 sealed proposal method of procurement. The governmental unit
12 shall evaluate any proposal that meets the requirements of the
13 governmental unit and is timely submitted by a qualified
14 provider. The request for proposals shall be announced through a
15 public notice from the governmental unit which will administer
16 the program. The request for proposals shall provide all
17 interested parties with sufficient information necessary to
18 submit a timely and responsive proposal.
19 (d) Selection and notice.--The governmental unit shall
20 select the qualified provider that best meets the needs of the
21 governmental unit in accordance with criteria established by the
22 governmental unit. For governmental units that are not required
23 to take actions on contracts at public meetings, the
24 governmental unit shall provide public notice of the award of
25 the guaranteed energy savings contract within 30 days in the
26 Pennsylvania Bulletin. The notice shall include the names of the
27 parties to the contract and the purpose of the contract. For
28 governmental units that are required to take actions on
29 contracts at public meetings, the public notice shall be made at
30 least ten days prior to the meeting. After reviewing the
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1 proposals pursuant to subsection (e), a governmental unit may
2 enter into a guaranteed energy savings contract with a qualified
3 provider if it finds that the amount it would spend on the
4 energy conservation measures recommended in the proposal would
5 not exceed the amount to be saved in both energy and operational
6 costs within a [ten-year] 15-year period from the date of
7 installation if the recommendations in the proposal were
8 followed and the qualified provider provides a written guarantee
9 that the energy or operating cost savings will meet or exceed
10 the cost of the contract.
11 (e) Report.--
12 (1) Before the award of a guaranteed energy savings
13 contract, the qualified provider shall provide a report as
14 part of its proposal which shall be available for public
15 inspection, summarizing estimates of all costs of
16 installation, maintenance, repairs and debt service and
17 estimates of the amounts by which energy or operating costs
18 will be reduced.
19 (2) The report shall contain a listing of contractors
20 and subcontractors to be used by the qualified provider with
21 respect to the energy conservation measures.
22 (f) Bond.--A qualified provider to whom a contract is
23 awarded shall give a sufficient bond to the governmental unit
24 for its faithful performance. Commonwealth agencies shall obtain
25 such bonds in accordance with the provisions of section 533
26 (relating to security and performance bonds). All other
27 governmental units shall obtain such bonds in accordance with
28 the act of December 20, 1967 (P.L.869, No.385), known as the
29 Public Works Contractors' Bond Law of 1967.
30 (g) Award of contract.--Notwithstanding any other provision
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1 of law governing the letting of public contracts, a governmental
2 unit may enter into a single guaranteed energy savings contract
3 with each responsible provider selected in accordance with the
4 provisions of this subchapter.
5 § 3754. Contract provisions.
6 (a) General rule.--A guaranteed energy savings contract may
7 provide that all payments, except obligations on termination of
8 the contract before its scheduled expiration, shall be made over
9 a period of time. Every guaranteed energy savings contract shall
10 provide that the savings in any year are guaranteed to the
11 extent necessary to make payments under the contract during that
12 year.
13 (b) Written guarantee.--A guaranteed energy savings contract
14 shall include a written guarantee that savings will meet or
15 exceed the cost of the energy conservation measures to be
16 evaluated, recommended, designed, implemented or installed under
17 the contract.
18 (c) Payments.--A guaranteed energy savings contract may
19 provide for payments over a period of time not to exceed [ten]
20 15 years and for the evaluation, recommendation, design,
21 implementation and installation of energy conservation measures
22 on an installment payment or lease purchase basis.
23 (d) Improvements not causally connected to an energy
24 conservation measure.--An improvement that is not causally
25 connected to an energy conservation measure may be included in a
26 guaranteed energy savings contract if:
27 (1) the total value of the improvement does not exceed
28 15% of the total value of the guaranteed energy savings
29 contract; and
30 (2) either:
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1 (i) the improvement is necessary to conform to a
2 law, a rule or an ordinance; or
3 (B) (II) an analysis within the guaranteed energy <--
4 savings contract demonstrates that there is an economic
5 advantage to the governmental unit implementing an
6 improvement as part of the guaranteed energy savings
7 contract;
8 and the savings justification for the improvement is documented
9 by industry engineering standards.
10 (e) Other capital expenditures.--A facility alteration which <--
11 includes capital expenditures that are required to properly <--
12 implement other energy conservation measures may be included as
13 part of a guaranteed energy savings contract. In such case,
14 notwithstanding any other provision of law, the installation of
15 these additional measures may be supervised by the contractor
16 performing the guaranteed energy savings contract.
17 Section 2. Title 62 is amended by adding a section to read:
18 § 3758. Review of proposed capital improvement projects.
19 Prior to entering into a guaranteed energy savings contract
20 every governmental unit shall review all proposed capital
21 improvement projects for potential applicability of this
22 subchapter, and shall consider proceeding with a guaranteed
23 energy savings contract under this subchapter where appropriate.
24 Section 3. This act shall take effect in 60 days.
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